A FINRA arbitration panel recently awarded Janney Montgomery Scott $2.3 million in compensatory damages in a raiding claim the firm had filed against Hunter Associates, a Pittsburgh based investment management firm.

Janney Montgomery Scott filed a complaint against Hunter with FINRA in May 2011, accusing Hunter of raiding its Salem, Pennsylvania office and interfering with its business. The complaint said Hunter opened its own office in the town after hiring Janney’s management team and financial advisors.

Such “raiding” claims are typical in the securities business when one firm attempts to recruit away an entire office of financial advisors (as opposed to recruiting a single financial advisor). An award of this type, however, is unusual, and appears to signal that the arbitration panel was convinced that Hunter Associates recruiting efforts were improper and represented raiding.

According to filings the firms made this year with the Securities and Exchange Commission, Hunter had 15 employees and managed $663.8 million in 918 accounts while Philadelphia-based Janney had 1,810 employees and managed $10.9 billion in 36,059 accounts.

Hunter Associates filed a complaint of its own, alleging among other things that Janney failed to pay Mr. McCulloch deferred compensation and published false and defamatory statements about him. The three arbitrators dismissed Hunter Associates’s complaint.

The foregoing information is being provided by The White Law Group, a national securities arbitration and securities employment law firm with offices in Chicago, Illinois and Boca Raton, Florida. The firm represents securities professionals in all manner of employment related disputes, including raiding claims.